Eli Broad might best be known to the average Angeleno as being the second name in Kaufman and Broad Home Corp. a Westwood-based company that has grown into one of the nation’s biggest home builders by selling affordable houses to first-time buyers.
But these days, Broad, who also is chairman, chief executive and founder of SunAmerica Inc., a financial services giant and one of the city’s fastest growing public companies, has become a preeminent business leader in Los Angeles. He is currently heading up the fund-raising effort for the $220 million Walt Disney Concert Hall, to be built in downtown Los Angeles.
Broad recently met with Business Journal editors and reporters to discuss Los Angeles’ business environment, the revitalization of downtown L.A. and arts and culture in the city.
Question: The national business magazines have been all agog about the Silicon Valley lately, and virtually ignoring Los Angeles. What’s your take on that?
Answer: My take is perceptions lag reality, and if you think about how people view Los Angeles and Southern California image-wise, one, they don’t recognize we’ve regained all the jobs we lost in defense and aerospace. Two, they think in terms of civil disturbances, the O.J. Simpson trial, earthquakes, fires and so on.
The fact is that we really have our unemployment down. We’ve had a vast recovery from a recession that hit us harder than other parts of the country. It’s hard for people to comprehend today’s realities.
If you look at the growth here in the entertainment industry, multimedia and other sectors, this is a vibrant place. Now, is it is as exciting as Seattle or the Silicon Valley today? It’s a different ball game. I mean, we’re talking about a region here with 25-some-odd million people. What are we talking about in the Silicon Valley? Two million, maybe, between San Jose and the surrounding area.
Q: The multimedia industry is still fairly new. Does that bode well for L.A.’s future growth prospects, compared with that of other metro areas?
A: One of the advantages we have as a horizontal city is that it lends itself to these technologies, communications and such, which would not happen when you’re across the street from one another in highrise buildings in Chicago. I’m convinced this is the city of the 21st century. We did have setbacks. We lost the two major banks that we had here, as you’re well aware. I think there’s a big void there. We’re going to find someone to come here, whether it’s a Citicorp or a NationsBank or God knows who to plant their flag and move their headquarters.
Q: There seems to be a schism between the downtown business community and the entertainment community. Where are the Michael Eisners and the Rupert Murdochs when it comes to local civic involvements?
A: With industries that are relatively new and/or entrepreneurial, whether it’s Silicon Valley or the entertainment industry, generally it takes some time to get the maturity to get involved in a broader community. And I think if you look at Silicon Valley and say, “What are these people doing other than keeping to themselves? Do they belong to California Business Round Table, or get involved in this, that or the other thing?” the answer is “Not very much.”
The same thing is true in the entertainment industry. I think that has to change. They ought to be more involved in our civic institutions, cultural institutions and higher education than they are.
Q: Maybe they don’t have as much to gain.
A: I think what you’re saying is correct. Los Angeles is not viewed as a philanthropic city compared to New York, Chicago, Minneapolis, Cleveland they’re older cities. But you know both philanthropic growth and cultural growth follow economic growth by several decades. And I think we’re becoming more philanthropic.
As people in the entertainment industry do well, they’re going to realize that they ought to give something back, that you can’t take it with you. And just accumulating wealth without doing good isn’t going to be satisfying for many people.
All of these people have big egos. I have a big ego. And therefore, if they see their colleagues doing things that are getting attention and getting respect from a broader community, I think they’ll want to follow.
Q: How difficult has it been to convince the public that the Disney Concert Hall is really necessary for the city?
A: You always have people who want to maintain the status quo, who want to look back to what they consider the good old days.
If you go out and say we want money for Disney Hall, some people say, “That’s nice,” and give, and others say, “I don’t like the architecture,” and get into some of the small issues.
We have said, “It isn’t about Disney Hall.” We need a performing arts center second to none for this region in the 21st century, and this happens to be the venue.
No great city in world history has ever been great or wealthy without a core or center. Our core is downtown. So we changed our pitch for Disney Hall; it’s about the city, not just about whether you like a building or don’t like a building.
Q: If you could take us back to the last couple months of your fund-raising efforts, what approach did you take to get these folks to sign the check?
A: Well, the first thing you have to do is convince yourself and, as you know, I said I’ll give them at least $5 million, and the mayor said he would give them at least $5 million. So, once you do that, then you start with the largest and wealthiest corporations, individuals and foundations, and go down the list. And it’s not a one-call sale. You just start with Arco, for example.
Q: Did you know Arco CEO Mike Bowlin?
A: Sure, I know all these people. (I would say,) “I want to come down and see you and talk about downtown.” Or, “the mayor and I want to do it.” The mayor made many calls with me. You go through a lot of what we talked about about this city and what it really needs and what’s happening and why Disney Hall will be a real asset to this. And I’ve given $5 million, Dick’s given $5 million, we’d like Arco to do X.
Q: How much of your time have you spent on this thing?
A: Too much. (laughs) In terms of hours a week, it was running a good 10 hours or more a week 15 hours a week, between calls and meetings.
So yeah, I have a passion for this. I’m not interested in serving on boards and being a potted plant and listening to dog-and-pony shows from the director. That’s not fun. Why spend time doing that? I want to feel I’m making a difference and making some contribution. And I feel good about it.
Q: Are there weeks when you look at your schedule and feel conflicted about the amount of time you’re investing?
A: Well, I’m blessed at SunAmerica, where we have a very broad and deep management team. So I don’t have to do anything day-by-day. I stir the pot, I do help create and maintain a culture.
I work all the time. I’m an eclectic workaholic. I don’t play golf, I play tennis. Why? Four hours of golf is you know, it’s a four- or five-hour trip. I really don’t go to the movies. I don’t watch much TV, other than in the morning, I watch CNN or something while I’m getting dressed and shaving, or in the evening I try to catch the news if I get home in time.
But all the rest of the time, I’m involved in one activity or another. So I probably, one, put in more hours and, two, am blessed with a good personal staff, where some of the things that would take up my time and are mundane, they do for me.
